Collateral Requirements

Despite RociFi pioneering under-collateralized and capital-efficient DeFi loans, each loan on RociFi must be at least partially secured by collateral. In V2, users are able to secure stablecoin loans with 6 types of collateral: WETH, WBTC, MATIC, DAI, USDC, USDT.

Read here about Loan-to-value and Collateral configurations in RociFi V2.

Locked and Available Collateral

When a user proceeds to take a loan, the required collateral amount moves from a user’s available amount to their locked amount. The locked amount is collateral posted by the user to support a specific loan. Importantly the locked collateral amount can only be returned to the user when they fully repay the loan. Partial payments or a rise in the collateral’s value will not release unlock the collateral supporting a loan. Only when a loan is fully repaid is the collateral supporting it is unlocked. At which point the user could either take a new loan or withdraw it.

Adding Collateral

Users are able to add collateral to the protocol either at the point of borrow or though User Dashboard’s Collateral menu.

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  1. At the point of borrow, users can deposit only collateral amount required specifically for the given loan (required amount is calculated based on these configurations). This amount becomes locked once loan’s principal amount has been disbursed.
  2. Through the dashboard, users are free to deposit any collateral amount they want. This collateral amount stays ‘available to withdraw’ until it becomes locked in the loan.

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Withdrawing Collateral

Users can withdraw available, i.e. unlocked within the loan, collateral through Dashboard.